European equities resumed their upward trajectory yesterday, led by a rally in cyclical sectors — especially automotive. Recently out of favour, carmakers staged a powerful rebound, with Stellantis climbing 9.14%, Volkswagen 6.16%, and Mercedes-Benz 5.76%, topping the Euro Stoxx 50 leaderboard. Even SAP, the continent's largest listed company, could not dampen the mood — despite falling 4.10% on earnings that failed to impress. Markets chose to focus on the brightening outlook for EU–Japan trade relations. And that wasn’t all — the Financial Times, just after the European close, revealed that Brussels and Washington are on the cusp of a deal introducing a standard 15% tariff on European goods imported into the US. While not ideal, 15% is preferable to the previously mooted 30%, and it was enough to send pre-market indicators sharply into the green this morning.

On Wall Street, gains were more restrained but nonetheless positive. The S&P 500 rose by 0.78% to notch a new all-time high, while the Nasdaq 100, after a hesitant start, resumed its upward march.

Meanwhile, investors are being deluged with earnings. Tesla and Alphabet headlined last night’s post-market releases, marking the first of the much-watched “Magnificent Seven” to report this season. The early verdict: AI continues to fuel revenue growth at Google, though it’s forcing the company to spend heavily to maintain a technological edge. At Tesla, Elon Musk struck a more cautious tone, warning of choppy quarters ahead following the end of US subsidies for electric vehicles. The stock fell 4% after hours.

Elsewhere in the earnings deluge, around one hundred megacaps are due to report today. European highlights include LVMH, Roche, Nestlé, and TotalEnergies, while across the Atlantic, Blackstone, Intel Corporation and Newmont Corporation are on deck. As usual, a summary of early results can be found below this column for companies reporting before market open.

Another focal point today: July’s flash PMI indicators, a barometer of business sentiment among purchasing managers in major economies. The first reading, out of Japan overnight, was underwhelming — the Flash Manufacturing PMI fell to 48.8, signalling contraction, against an expected expansion at 50.2. Further readings will drop throughout the day: 9:15am for France, 9:30am for Germany, 10:00am for the eurozone, 10:30am for the UK, and 3:45pm for the US.

Finally, to cap off what is clearly an over-packed Thursday, the ECB will announce its interest rate decision at 2:15pm, with Christine Lagarde scheduled to comment at 2:45pm. Markets widely expect a pause — the first after eight consecutive cuts.

In Asia–Pacific, markets remain mixed — a theme that has persisted all week. Japan posted another strong session, with the Nikkei rising 1.60% on easing trade tensions. China also traded higher: Shanghai added around 0.50%, and Hong Kong 0.60%. South Korea hovered near flat, with the KOSPI inching toward a neutral close. Meanwhile, Australia's ASX and India's Sensex both dipped by 0.30%. Futures point to a bullish open in Europe.

Today's Economic Highlights:

On today's agenda: Japan's PMIs; followed by those of France, Germany, the eurozone, and the United Kingdom; in the eurozone, the ECB rates will also be monitored; in the United States, the Chicago Fed National Activity Index, new unemployment claims, PMIs, and new home sales are expected. See the full calendar here.

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  • Gold: US$3,376.99
  • Crude Oil (BRENT): US$68.88
  • United States 10 years: 4.4%
  • BITCOIN: US$117,649

In corporate news:

  • BNP Paribas beats second-quarter profit forecasts, buoyed by a jump in trading revenue.
  • Dassault Systèmes reports a decline in net profit for the first half of the year, with currency fluctuations weighing on margins.
  • STMicroelectronics reports a second-quarter loss and targets revenue of $3.17 billion for Q3.
  • Pernod Ricard sells its Indian whisky brand Imperial Blue.
  • Air Liquide will invest more than €500 million in a 200 MW electrolyser in the port of Rotterdam.
  • Stellantis is recalling more than 120,000 vehicles in the United States due to a headrest issue.
  • Eurazeo's assets under management reached €36.8 billion in the first half of the year.
  • Ipsos returns to organic growth and confirms its annual targets.
  • Nestlé reports higher-than-expected organic sales growth in the first half of the year.
  • Roche confirms its forecasts after a 6% increase in operating profit in the first half of the year.
  • Deutsche Bank posts higher-than-expected quarterly profit.
  • Moncler's operating profit falls 13% in the first half of the year due to marketing expenses.
  • Banco de Sabadell posts net profit of €486 million in the second quarter.
  • Indra Sistemas confirms all its financial targets for 2025.
  • BE Semiconductor Industries sees a decline in orders in the second quarter.
  • Kuehne und Nagel International revises its recurring earnings forecast due to unfavourable currency effects.
  • The US FDA has extended its review of GSK's blood cancer drug.
  • Saipem has confirmed its forecasts after a strong first half.
  • Georg Fischer has increased its profitability despite a decline in sales.
  • Alphabet's profits rose in the second quarter, as did capital expenditure.
  • Tesla anticipates difficult quarters after the end of US support for electric vehicles.
  • T-Mobile US raises its subscriber forecast, driven by demand for its premium offerings.
  • IBM's software sales disappoint, with the stock falling 5% in after-hours trading.
  • ServiceNow raises its annual revenue forecast thanks to strong demand for its AI-powered tools.
  • Microsoft warns about the use of ransomware by hackers exploiting SharePoint.
  • Goldman Sachs abandons a second wave of job cuts thanks to an improved outlook.
  • Visa opens a data centre in South Africa.
  • Sony is considering selling its mobile chipset division.
  • SK Hynix, a supplier to Nvidia, plans to increase investment after record quarterly profits.
  • Hyundai Motor's profit falls 16% in the second quarter due to US tariffs.

See more news from UK listed companies here

Analyst Recommendations:

  • Lloyds Banking Group Plc: Goldman Sachs maintains a neutral recommendation with a price target raised from GBX 82 to GBX 87.
  • Breedon Group Plc: Berenberg maintains its buy recommendation and reduces the target price from 590 to GBX 540.
  • Informa Plc: Berenberg maintains its buy recommendation and raises the target price from 930 to GBX 1030.
  • Phoenix Group Holdings Plc: RBC Capital maintains its outperform rating and reduces the target price from GBX 725 to GBX 690.
  • M&G Plc: RBC Capital maintains its sector perform recommendation and raises the target price from GBX 225 to GBX 240.
  • Compass Group Plc: RBC Capital maintains its sector perform recommendation with a price target raised from 2625 to GBX 2700.
  • Next Plc: Barclays maintains its equalweight recommendation with a price target raised from GBP 119 to GBP 119.50.
  • Informa Plc: Barclays maintains its overweight recommendation and raises the target price from 9.20 to GBP 10.
  • Cranswick Plc: Jefferies maintains its buy recommendation and raises the target price from 57 to GBP 62.
  • Gsk Plc: Zacks maintains a neutral recommendation with a price target reduced from USD 41 to USD 39.
  • Ocado Group Plc: Goldman Sachs maintains its neutral recommendation with a price target raised from GBX 350 to GBX 400.
  • Iberdrola, S.a.: DZ Bank AG Research maintains its hold recommendation with a price target reduced from 15.80 to EUR 15.50.
  • Lindt : Berenberg maintains its hold recommendation with a price target raised from 105,800 to 110,CHF 446.
  • Evolution Ab: Rothschild & Co Redburn maintains a sell recommendation with a price target raised from 600 to SEK 650.
  • Moncler S.p.a.: Mediobanca maintains its neutral recommendation with a price target reduced from 58 to EUR 56.